How does online banking bill payment work?
Payments
Asked by Question Bot05/Jul/20171 answer
1 Answer
F
Faisal Khan
Answered 05/Jul/2017
Bill pay can work in many different ways, depending in which country you are in.
Typically, banks will have access to the billers (utility companies, telco companies, etc.) The billing database can be real-time, but is mostly batch processed.
Everyday, banks will download or access the pending bills database and keep a localized copy. When a person requests payment for a bill, the database serves the amount along with the details for the account number in question.
Once the bill is paid, the bank will upload the payments it has received on behalf of the biller back to the billing company and present an IOU for funds. These funds are then aggregated and push out to the respective billers' bank accounts for further ledger updates.
Banks needless to say have to make specialized arrangements to incorporate bill payments into their online banking.
A more upcoming trend is to bill aggregators to offer this service to banks. Billing aggregators are doing all the dog work at the backend, signing up with 1000s of billers and aggregating them centrally into their systems. So banks simply connect via an API and have a one-window approach towards bill payment.
Typically, banks will have access to the billers (utility companies, telco companies, etc.) The billing database can be real-time, but is mostly batch processed.
Everyday, banks will download or access the pending bills database and keep a localized copy. When a person requests payment for a bill, the database serves the amount along with the details for the account number in question.
Once the bill is paid, the bank will upload the payments it has received on behalf of the biller back to the billing company and present an IOU for funds. These funds are then aggregated and push out to the respective billers' bank accounts for further ledger updates.
Banks needless to say have to make specialized arrangements to incorporate bill payments into their online banking.
A more upcoming trend is to bill aggregators to offer this service to banks. Billing aggregators are doing all the dog work at the backend, signing up with 1000s of billers and aggregating them centrally into their systems. So banks simply connect via an API and have a one-window approach towards bill payment.